FORTUNE 500 COMPANIES IN INDIA
ALLIANZ GROUP
Background
Allianz is one of the leading providers of insurance and asset management products and services worldwide. The companies that make up Allianz Group have presence in property and casualty insurance, life and health insurance, asset management and banking. Founded in 1890 in Berlin, Allianz is now present in over 70 countries, employs about 174,000 and has over 60 million customers. In 2003, the Allianz Group was ranked 11th in the Fortune 500 list and had worldwide revenues of USD 114.9 billion.2
An Allianz group company, Allianz Aktiengesellschaft Holding set up its liaison office in India in 1996.3 In India, Allianz is currently present in Life and General Insurance.
Bajaj Allianz Life Insurance Co. Ltd. (BALICL) Bajaj Allianz General Insurance Co. Ltd. (BAGICL) are 26:74 joint ventures between two leading conglomerates - Allianz AG, one of the world’s largest insurance companies, and Bajaj Auto, one of the largest two and three wheeler manufacturers in the world.
BAGICL received the Insurance Regulatory and Development Authority (IRDA: the Indian insurance regulator) approval in May 2001 to conduct General Insurance business (including Health Insurance business) in India. Bajaj Allianz General Insurance offers products in all areas of general and health insurance and risk management. Within its first year of operations itself, the company had acquired the No. 1 status among the private non-life insurers. In the financial year 2003-04, BAGICL maintained its leadership position among private non-life insurers by garnering a premium income of USD 104.4 million. The company employs about 480 people and has 38 offices spread across the country.
BALICL received IRDA approval in August 2001 to conduct Life Insurance business in India. It is one of the fastest growing private sector life insurers in the country. The company has customer care centres in 155 cities. Currently the company has a product portfolio of 18 products and more are in the pipeline.
A leading private sector insurance player
Milestones of Bajaj Allianz General Insurance:
• One of the largest private non-life insurance companies in India
• Sells around 1,00,000 policies a month
• Total premium collection increased by 60 per cent from US$ 61.9 million in 2002-03 to US$ 104.4
million in 2003-04
• Profit after tax increased by 138 per cent from US$ 2.0 million in 2002-03 to US$ 4.7 million in 2003-04
• Market share of 22 per cent among private sector life insurers in 2002-03 in terms of total premium collected
Return on equity of 20 per cent in 2003-04, which is one of the highest in the Indian insurance industry.
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SUCCESS STORIES
Milestones of Bajaj Allianz Life Insurance:
• One of the fastest-growing private life insurance companies in India
• Currently has over 300,000 customers (as of February 2004) in a short span of 29 months. The company was the fastest to touch the 100,000 &
200,000 customers mark amongst private insurance companies
• Total premium collection increased by 236 per cent from US$ 14.3 million in 2002-03 to US$
47.9 million in 2003-04
• Market share of 7.4 per cent among private sector life insurers in 2003-04 in terms of first year and single premium collected
In the April to July quarter of 2003-04, as per the IRDA figures, BALICL had moved up to the 3rd position amongst private insurance companies The market share amongst private sector players now stands at 11.2 per cent
Factors for success
“Our decentralization policy has begun to yield results.
In the current year we will be launching innovative and need-based products and using IT infrastructure to drive our growth strategy.”
Wide network and large sales force
“Our distribution network will help us also improve our market share while providing world-class service and sound value propositions through our products.”3 BALICL has pan India presence and a trained sales force of 28,000 agents, which is one of the largest amongst private sector life insurers in the country.
Bajaj Allianz pioneered the phenomenon of bancassurance in India, and has leveraged the channel to widen its distribution network. More than 20 per cent of BALICL’s total premium income is contributed by its three bancassurance partners viz., Standard Chartered Bank, Centurion Bank and Syndicate Bank.
BAGICL offers innovative distribution channels such as on-line issuance of policies. BAGICL has bancassurance tie-ups with 9 banks including Karnataka Bank and Saraswat Bank amongst others.
Decentralisation
BALICL has pioneered the issuance of policies at point-of sale whereby any branch or corporate agent could issue a policy from their own location in a short period of time. A policy can be issued within 5 minutes at any BALICL branch across the country.
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FORTUNE 500 COMPANIES IN INDIA
Enabling IT infrastructure
Bajaj Allianz has made significant investments in technology. With its in-house developed Black Box Underwriting system, an underwriting decision is given immediately from the local office itself. Black Box underwriting is proprietary IT enabled underwriting software, which has standardised underwriting across the country and has eliminated variances due to human judgement.
Bajaj Allianz is one of the first companies to use such sophisticated IT systems for quick decision-making.
Bajaj Allianz has developed the necessary software in- house and has integrated it with its main policy transaction software.
The investments in technology have enabled the company to maximise its service levels. After pioneering policy issuance online, BAGICL has launched a new service: claims status alerts through short message service (SMS). It is one of the first general insurance companies in India to launch this facility.
Leveraging the India Advantage
Allianz Group companies are leveraging the India advantage in different areas:
Business process outsourcing
UK based Allianz Cornhill Insurance plc (an Allianz Group Company) has set up an Indian subsidiary
Allianz Cornhill Information Services for software development and business process outsourcing. The centre currently employs around 100 people and is expected to increase its headcount to 400 by end of year 2005.
Software development and maintenance Wipro, one of India’s largest Information Technology (IT) companies, has been involved in enhancing Allianz’s core IT applications in its offshore development centres. Wipro’s offshore development centres act as an extension of the Allianz IT department and assist Allianz in rapid development, deployment and integration of critical applications across a host of technologies.
Future plans The Allianz Group plans a foray into wealth management, asset management and pension funds sectors in India.
• BALICL plans to increase its bancassurance channel by tying up with more banks.
• BALICL is planning to widen its distribution network and adopt multi-channel distribution including bancassurance and corporate agents, besides strengthening its individual agency force.
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